UAE VAT started on 1 January 2018 at a standard rate of 5% (Federal Decree-Law No. 8 of 2017, Article 3), the same in Dubai and every other emirate. The amendments in force from 1 January 2026 did not change the rate.
Type an amount to see both answers:
5% VAT formulas
| You have | You want | Sum | Excel (amount in A1) |
|---|---|---|---|
| Price excluding VAT | VAT | × 0.05 | =A1*0.05 |
| Price excluding VAT | Price including VAT | × 1.05 | =A1*1.05 |
| Price including VAT | Price excluding VAT | ÷ 1.05 | =A1/1.05 |
| Price including VAT | VAT inside | × 5 ÷ 105 | =A1*5/105 |
VAT inclusive or VAT exclusive?
- VAT exclusive (“excluding VAT”, “VAT excluded”, “+ VAT”): the price before VAT. Add 5% to get what you pay.
- VAT inclusive (“including VAT”): the VAT is already in the price. Divide by 1.05 to find the price before VAT.
Advertised prices must include VAT (Article 38). A business may show prices excluding VAT when it exports or sells to a VAT-registered customer, and must label them as excluding VAT (Executive Regulation, Article 27).
Adding VAT to a price
Multiply the price before VAT by 1.05.
Example: a service costs AED 1,000 before VAT.
- VAT: 1,000 × 0.05 = AED 50
- Total: AED 1,050
Removing VAT from a price (reverse VAT)
To take VAT off a price that includes it, divide by 1.05. Do not subtract 5%; that gives the wrong answer.
Example: you paid AED 1,050 including VAT.
- Price before VAT: 1,050 ÷ 1.05 = AED 1,000
- VAT: 1,050 − 1,000 = AED 50
Subtracting 5% from 1,050 gives 997.50, which is AED 2.50 too low. VAT was charged on the price before VAT, not on the total.
Reverse VAT is not the reverse charge (Article 48), the rule under which a business that imports goods or services for its business accounts for the VAT itself.
Finding the VAT inside a total: the 5/105 shortcut
Multiply the total by 5, then divide by 105.
Example: a bill of AED 12,000 including VAT.
- VAT: 12,000 × 5 ÷ 105 = AED 571.43
- Price before VAT: 12,000 − 571.43 = AED 11,428.57
VAT can be rounded to the nearest fils (Executive Regulation, Article 61).
VAT after a discount
VAT is charged on the price after a discount that the seller pays for and you get (Article 39; Executive Regulation, Article 28).
Example: AED 1,000 with 10% off.
- Price after the discount: AED 900
- VAT: 900 × 0.05 = AED 45
- Total: AED 945
5% VAT on common amounts (AED)
| Amount | VAT added | Total with VAT | If it includes VAT: before VAT | VAT inside |
|---|---|---|---|---|
| 100 | 5.00 | 105.00 | 95.24 | 4.76 |
| 500 | 25.00 | 525.00 | 476.19 | 23.81 |
| 1,000 | 50.00 | 1,050.00 | 952.38 | 47.62 |
| 5,000 | 250.00 | 5,250.00 | 4,761.90 | 238.10 |
| 10,000 | 500.00 | 10,500.00 | 9,523.81 | 476.19 |
| 12,000 | 600.00 | 12,600.00 | 11,428.57 | 571.43 |
What a business pays: output VAT minus input VAT
The VAT payable for a tax period is the VAT charged on sales (output tax) minus the recoverable VAT paid on purchases (input tax) in the same period (Article 53). Article 54 sets which input VAT is recoverable.
Example: VAT on sales AED 5,000, recoverable VAT on purchases AED 3,000. VAT payable: 5,000 − 3,000 = AED 2,000.
Zero-rated and exempt supplies
Most goods and services carry 5%.
- Zero-rated (0%), Article 45: exports to outside the GCC states that apply VAT, international transport, investment precious metals, crude oil and natural gas, the first sale or lease of a new home within 3 years of completion, and some education and healthcare.
- Exempt (no VAT), Article 46: some financial services, residential sales and leases that are not zero-rated, bare land and local passenger transport.
The Executive Regulation sets the conditions for each.
When must a business register?
Registration is mandatory if taxable supplies and imports exceed AED 375,000 over the previous 12 months or are expected to in the next 30 days (Article 13; Executive Regulation, Article 7). The application is due within 30 days.
A business can register voluntarily if its supplies, or its expenses subject to VAT, exceed AED 187,500 (Article 17; Executive Regulation, Article 8).
Removing a VAT registration (deregistration)
“Remove VAT” can also mean cancelling a business’s VAT registration.
- Must apply within 20 business days if it stops making taxable supplies, or if its taxable supplies over 12 months are below AED 187,500 and its supplies or taxable expenses are not expected to pass that in the next 30 days (Article 21; Executive Regulation, Article 14).
- May apply if its taxable supplies over the past 12 months were below AED 375,000 (Article 22), but not within 12 months of a voluntary registration (Article 23).
All VAT and penalties due must be paid and a final return filed (Executive Regulation, Article 14).
Calculate it
The VAT calculator does the same at any rate, and you can copy, print or share the result.
Sources: Federal Decree-Law No. 8 of 2017 on VAT, with amendments, Executive Regulation, Cabinet Decision No. 52 of 2017, with amendments to 2026 and FTA Public Clarification VATP046 on the amendments, all PDFs on the Federal Tax Authority site (English texts are unofficial translations). Checked 7 November 2026.
Common questions
What does VAT excluded mean?
The price is before VAT. Add 5% to get what you pay: AED 100 excluding VAT is AED 105 including VAT.
How do I take VAT off a price?
Divide the price including VAT by 1.05. AED 105 ÷ 1.05 = AED 100, so the VAT was AED 5. Taking 5% off 105 gives 99.75, which is wrong.
Is VAT 5% in Dubai?
Yes. VAT is set by a federal law, Federal Decree-Law No. 8 of 2017, so the 5% rate is the same in Dubai, Abu Dhabi and every other emirate.
Work out your own figure
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Open the calculatorarrow_forwardThis guide is general information, not legal advice. Check your own case with the Federal Tax Authority or a tax adviser. See our Disclaimer.
